Wednesday, December 22, 2010

Foreclosure: The New Home Invasion

Banks Accused of Break-Ins During Foreclosure:

When Mimi Ash arrived at her mountain chalet here for a weekend ski trip, she discovered that someone had broken into the home and changed the locks.

When she finally got into the house, it was empty. All of her possessions were gone: furniture, her son’s ski medals, winter clothes and family photos. Also missing was a wooden box, its top inscribed with the words “Together Forever,” that contained the ashes of her late husband, Robert.

The culprit, Ms. Ash soon learned, was not a burglar but her bank. According to a federal lawsuit filed in October by Ms. Ash, Bank of America had wrongfully foreclosed on her house and thrown out her belongings, without alerting Ms. Ash beforehand.

“This is in essence a burglary,” said Ms. Ash, walking through the vacant home, with its four levels and commanding mountain views. “But when a burglar goes in, they don’t take your photos and your husband’s ashes.”

Remember how I compared the wave of Foreclosure Crimes not only to white-collar crime but good old fashioned street crime (even violent crime)? Hate to say I told you so, but, well, not really: I told you so.

Some of the cases appear to be mistakes involving homeowners who were up to date on their mortgage — or had paid off their home — but who still became targets of a bank.

In Texas, for example, Bank of America had the locks changed and the electricity shut off last year at Alan Schroit’s second home in Galveston, according to court papers. Mr. Schroit, who had paid off the house, had stored 75 pounds of salmon and halibut in his refrigerator and freezer, caught during a recent Alaskan fishing vacation.

In Florida, contractors working for Chase Bank used a screwdriver to enter Debra Fischer’s house in Punta Gorda and helped themselves to a laptop, an iPod, a cordless drill, six bottles of wine and a frosty beer, left half-empty on the counter, according to assertions in a lawsuit filed in August.

In Washington, Celeste Butler went to check on her father’s house after he spent months in the hospital and ultimately died.

“The house was ransacked,” Ms. Butler said, adding that it had been neatly maintained beforehand. “They had destroyed furniture, broken into china cabinet. They had looted jewelry.”

Of course, Chase, Bank of America, Wells Fargo and other big mortgage/big banks have a defense: blame the contractors (whose own defense is, we're just following orders).

Chase officials said such behavior by its contractors, if determined to be true, would be considered unacceptable and corrective action would be taken.
Don't you love it? How many common street thugs could use the same defense? "If it is determined that I broke into your house, then that's unacceptable and corrective action will be taken to ensure I don't steal your shit again."

Uh, the "corrective action" should be Chase, Wells Fargo, Bank of America and other mortgage executives going to the Cross-Bar Hilton.

But that won't happen, since the criminals in Big Banking and Big Mortgage have gone to extreme measures to convince most of the American public that the foreclosure crisis, according to Matt Taibbi, is mainly "deadbeat homeowners who won't pay their fucking bills."

What's sad is that most Americans who have an opinion about the foreclosure crisis don't give a shit about all the fraud involved. They don't care that these mortgages wouldn't have been available in the first place if the banks hadn't found a way to sell oregano as weed to pension funds and insurance companies. They don't care that the Countrywides of the world pushed borrowers who qualified for safer fixed-­income loans into far more dangerous adjustable-rate loans, because their brokers got bigger commissions for doing so. They don't care that in the rush to produce loans, people were sold houses that turned out to have flood damage or worse, and they certainly don't care that people were sold houses with inflated appraisals, which left them almost immediately underwater once housing prices started falling.

The way the banks tell it, it doesn't matter if they defrauded homeowners and investors and taxpayers alike to get these loans. All that matters is that a bunch of deadbeats aren't paying their fucking bills. "If you didn't pay your mortgage, you shouldn't be in your house — period," is how Walter Todd, portfolio manager at Greenwood Capital Associates, puts it. "People are getting upset about something that's just procedural."

LOL. That's the first time I've ever heard of robbery, burglary and home invasions referred to as "something procedural." But then, as Taibbi notes, "breaking and entering isn't a crime if it's authorized by a bank."

That's what this foreclosure crisis is all about: fleeing the scene of the crime. [The banks] put their foot on the foreclosure gas pedal and stepped up the effort to kick people out of their homes as fast as possible, before the world caught on to how these loans were made in the first place.
For a blistering in-depth analysis of just how fraudulent these loans were, read "Dude, Where's My Mortgage?" by Yahsa Levine. Not only do most of these banks not have a clue where the titles are in these foreclosures, many of them are fabricating chain of title documentation and, as Taibbi illustrates, having kangaroo courts sign off on them without determining the veracity of the documents. The crimes which are being perpetrated (fraud, tax evasion, breaking and entering, ad nauseum) are breathtaking.

And yet, none of that matters as long as the American public, and its bought and paid for political system, signs off on these crimes as "paperwork errors," and continues to view the real estate collapse in this country as problem of the individual rather than a systemic raping of the public trust (and coffers) by Big Mortgage/Big Banking. As Taibbi notes (emphasis mine):
Nowhere else on the planet is it such a crime to be down on your luck, even if you were put there by some of the world's richest banks, which continue to rake in record profits purely because they got a big fat handout from the government. That's why one banker CEO after another keeps going on TV to explain that despite their own deceptive loans and fraudulent paperwork, the real problem is these deadbeat homeowners who won't pay their fucking bills. And that's why most people in this country are so ready to buy that explanation. Because in America, it's far more shameful to owe money than it is to steal it.


Barbara Ann Jackson said...


Scores of homeowners do not contest foreclosures because:
1. They don't have knowledge of the law in order to recognize which aspects of foreclosure are legally challengeable or even fraudulent.
2. Even those who identify wrongdoing, lack funds to pay for attorneys to represent them.
3. Homeowners are told to come to foreclosure auctions with money that they do not have, so they stay away from foreclosure auctions.

These homeowners are oblivious about sometimes "straw buyers" and sometimes lawyers in charge of foreclosures, obtaining illegal ownership of people's homes, and pay literally nothing through "credit bids;" and that those recorded deeds from such auctions are Null! For these very reasons, there needs to be a probe of lawyers who file foreclosures.

Also, the average lay person doesn't know about legal requirements of "standing" that prevents their homes from being repossessed via non-existent lenders, or via lenders who have no ownership of promissory notes.

Yet, courts are supposed to enforce "standing" and compliance with established laws! Illegal, defective, fraudulent foreclosure causes useless deeds for property sales; title insurance denials –and more.

Further, after certain foreclosure auctions (via simulation) result in fraudulent –NOT lender acquisitions, by lawyers or straw buyers, the common scenario becomes property flipping, neighborhood blight, rodents, and so on!

*Sample of fraudulent foreclosure acts:

-Deliberately use defunct lenders, lenders without "standing" for false civil and bankruptcy foreclosure proceedings
-Create and conceal malpractice foreclosure delays and engineer billable litigation
-Orchestrate sham foreclosure auctions; property never acquired by lenders, but 'straw buyers'
-Commit actionable wrongs (unfair debt collection, fraud, various torts) that create lawsuits
- Foreclosures naming defunct lenders, illegally recorded property deeds, flipping, blighted communities
-Unconscionably create false deficiency judgments against property owners after straw buyers acquire homes for pennies on the dollar
-Intentionally false Bankruptcy court "Motion to Lift" and "Proof of Claim" on behalf of non-existent lenders which conceals fact of a "non-secured" mortgage debt
-Involved in fraudulent collection of property damage insurance, as well as mortgage-default insurance
- Fraudulent foreclosures abet loss of property taxes to city revenue, and invites rodents, vagrants
- Thousands of families made unlawfully homeless from null foreclosure proceedings

Foreclosure lawyers are officers of the court. Lawyers are required to know applicable laws and civil procedure. This knowledge is not required of mortgage lenders, nor loan servicers.

*more @ Request for Congressional Foreclosure Panel to Examine Foreclosure Lawyers

Rachel said...

Thank you, Dr. Krohn! I am now afraid to go buy a house! ;-)